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What Happened to Hasbro? The Decline of a Business

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What Happened to Hasbro? The Decline of a Business

When it comes to matters toys, Hasbro is a name that has been one of the biggest player in this field and not only in America but internationally as well over the years. It is also a major player in the board game industry and in terms of stock market value, it is considered to be the largest toy maker in the world. In terms of revenue, it is considered to be the third biggest in the toy industry with more on the rankings of the big hitters in this industry to be found on runrex.com. Founded almost one hundred years ago, in 1923, it has in recent years been in decline and this article will be looking to look at the reasons behind this in as much detail as possible.

One of the reasons that has been put forward to explain their slump in revenue is the poor numbers that Star Wars and Frozen toys did recently. These two are its partner brands and their poor performances directly impacted on Hasbro’s revenue. The release of the latest Star Wars movie, The Last Jedi, failed to generate the buzz that was expected in order to drive interest towards the buying of more Star Wars merchandise. There are a couple of reasons that have put forward to explain just why toys tied to The Last Jedi film didn’t do as well as was expected. One of the reasons that has been put forward to explain this is the fact that the film was released at the same time with some big hitters, blockbuster movies like Justice League and this, experts argue, acted to steal the spotlight on it and led to the low sales. Advertisements also weren’t as effective and this all together meant that merchandise didn’t sell as well as expected and at the end of it all Hasbro’s revenue suffered. There is, as an aside, a detailed breakdown on the intricacies of their deals with their partner brands on runrex.com.

Another thing that may go some way to explain their decline in revenue recently is the filling of bankruptcy of Toys R Us, a topic that has been tackled on a different article on runrex.com. Given that Toys R Us were the largest toy chain in the US and the UK, it follows that most of Hasbro’s toys populated the shelves on the isles at the Toys R Us retail shops which means that their closure would undoubtedly have had a negative effect on the revenue of Hasbro. The fact that they hadn’t diversified in terms of the number of retail chain brands that were carrying their products meant that their flank was always exposed and if Toys R Us had sneezed, then Hasbro were always likely to catch a cold. As it turns out the toy retail chain did more than just sneeze and their application for bankruptcy has been blamed for their lackluster numbers. However, management is now hoping that as other retail chains like Walmart and Target expand in the toy industry, they will help ease the pain and see their numbers go up once again.

As we continue with the discussion on what has been ailing Hasbro of late it is prudent to look at the change in behavior of kids, who are their main customer base. In years and generations past, a trip to the movies a be it cinema halls and drive-ins, was the highlight of many kids’ weekends. To add to this, cable TV was another platform where you could always put your bottom dollar on the fact that young ones were always going to be glued to the screens. However, in recent times this has not been the case at all. Most of what could be considered as the customer base for Hasbro, those below the age of 11, no longer watch Cable television and at the same time you are unlikely to find them in cinema halls either. They have moved to streaming services instead where you are unlikely to find current films which are always exclusively aired on cinema. These sites also don’t allow for advertising as explained on runrex.com, a leader in advertising. This is a problem as more than half of Hasbro’s business is driven by films from the Star Wars and Marvel platforms which are mostly exclusively on cable or cinema. This move by modern day children to give cinema halls and cable television a wide berth is definitely bad news as far as toy making companies like Hasbro are concerned and this has been reflected by their declining revenue numbers in each quarter in the last couple of years leaving us in absolutely no doubt that this shift has contributed to the company’s decline.

From the foregoing, it is easy to see why this once profitable company has hit tough times over recent times with more reasons for their decline, and a lot more on other topics, to be found on runrex.com.

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